Supreme Court slams Singapore arbitrator for non-disclosure in MSA Global case

The Supreme Court on Wednesday expressed serious reservations about continuation of arbitration proceedings in Singapore between an Oman-based company and an Indian firm after taking note of a co-arbitrator’s admission that he had deliberately failed to disclose his prior involvement with one of the parties to avoid a possible challenge..A Bench of Chief Justice of India Surya Kant and Justice Joymalya Bagchi was hearing an appeal challenging a Delhi High Court order to injunct the arbitration proceedings between MSA Global LLC Oman and Engineering Projects India Ltd (EPIL). The Bench referred to the explanation provided by the co-arbitrator Andre Yeap for his non-disclosure. As noted by the Delhi High Court, Yeap had stated that had he made the disclosure, “the possibility of the respondent seeking to challenge my impartiality could not be discounted.”"An arbitrator who makes this sort of a comment does not deserve to be on this (arbitration),” Justice Bagchi remarked..The Court further cautioned that if the arbitrator continued with the proceedings, the arbitral award may become "unexecutable" in India. “Your sticking to the arbitrator vitiates appointment,” the Bench told the Oman-based company..An arbitrator who makes this sort of a comment does not deserve to be on this (arbitration).Supreme Court.The International Court of Arbitration of the International Chamber of Commerce (ICC Court) had earlier permitted continuation of the proceedings despite finding Yeap's non-disclosure to be regrettable. EPIL then moved the Delhi High Court challenging the continuation of proceedings. The High Court in 2025 restrained the arbitration from proceeding further, holding that the circumstances warranted judicial intervention.The High Court noted that MSA had earlier nominated Yeap, a Senior Counsel from Singapore, as its co-arbitrator in November 2018 in a separate matter, which involved Manbhupinder Singh Atwal, who is Managing Director, Chairman and Promoter of the MSA Global LLC Oman.This earlier matter came to the notice of EPIL through a judgment passed by the Gujarat High Court on July 5, 2024. The arbitral award in that case was passed in favour of Atwal, though it was later set aside by the Gujarat High Court.These developments were not disclosed by Yeap in the present case until EPIL moved the ICC Court against his appointment..After these facts were brought to the notice of the Delhi High Court by EPIL, the High Court ruled that non-disclosure was clearly hit by the fifth schedule of the Arbitration and Conciliation Act (A&C Act)."This Court is of the considered view that the omission to disclose the aforesaid prior professional involvement constitutes a material non-disclosure within the contemplation of the Fifth Schedule appended of the A&C Act, and is sufficient to induce a justifiable doubt in the mind of a fair-minded and objective person," the High Court said..It added that Yeap's subsequent statement before the ICC court of the non-disclosure was a clear admission that such disclosure could vitiate the arbitral process.Such conduct amounted to a breach of Section 12 of the Arbitration and Conciliation Act which mandates arbitrators to disclose any past or present relationship with or interest in any of the parties, the High Court made it clear."Despite having become aware of this conflict in October 2024, the arbitrator did not adhere to the continuous and mandatory duty of disclosure under Section 12(1) and 12(2) of the A&C Act, and thereafter, upon being challenged, tendered an explanation, which to our mind, is not only specious, but also a clear admission on the part of Mr. Yeap, that he was well aware of the consequences of the said disclosure and that such disclosure could vitiate the entire process. Tested against the objective standard of a reasonably informed and fair-minded third party, such omission undermines the necessity of neutrality and detracts from the integrity of the arbitral process. Consequently, the safeguards envisaged under Section 12 of the A&C Act stand breached," the High Court said while injuncting the arbitral proceedings.This led to the appeal before the Supreme Court..Today, Senior Advocate Harish Salve, appearing for MSA Global, told the Supreme Court that he has advised his client to terminate the mandate of the arbitrator. The matter will be taken up for further hearing on March 16. .Senior Advocates Mukul Rohatgi and Sandeep Sethi and advocates Ajit Warrier, Angad Kochhar, Himanshu Setia and Vedant Kashyap of Shardul Amarchand Mangaldas & Co. appeared for EPIL..[Read Live Coverage].Follow Bar and Bench channel on WhatsAppDownload the Bar and Bench Mobile app for instant access to the latest legal news.